Updated on July 23, 2024

Nickel and trading? Yes, it goes together! Nickel is one of the metals that we can normally come across in case we want to close commodity deals. However, in order for our nickel trades to be successful, we should first find out all the info about it. And that is why we have this article for you today. In addition to the properties of this metal commodity and its use, we will also take a look at how it is possible to close deals on nickel. And we will not leave out the factors that can affect the price of nickel on the market. So let’s get down to it!

Nickel – properties and uses

Nickel is a shiny silver-white metal. It is malleable and ductile. So you can work with him well. In addition, it is highly glossy and can be polished well. Its important feature is that it resists atmospheric influences, water and chemical conditions very well. And precisely because it is so permanent, it is often used to coat other metals. Especially iron, which is not so durable. Nickel thus protects it against corrosion.

We often encounter nickel plating on items we are familiar with. Such as screwdrivers, keys, but even coins. While earlier, for example in Czechoslovakia, coins were produced directly from an alloy of nickel and copper, now they are minted from steel. And the thin nickel layer only protects them against corrosion. Chemical dishes and surgical instruments are also covered with nickel.

This metal is also malleable. And that is why it finds use in other branches of industry. The vast majority of nickel is now used for galvanic cells . Nickel is usually found in devices that are designed to be recharged multiple times. This metal is therefore part of the batteries in our mobile phones, flashlights or nowadays well-known electric bicycles. In addition, nickel is also used as an effective catalyst.

Nickel alloys

Nickel is also useful as a compound with other elements. They are known, among other things, for an alloy called alpaca. Because of its appearance, it is sometimes called the new silver. It is an alloy of nickel, copper and zinc. Or other metals. Used for minting coins. Coins worth 1 and 2 euros are now minted from alpaca. At the same time, we can also find coins minted from this alloy in the USA and Canada. This is where the 5-cent coin is minted. This coin is therefore also known as a nickel.

Some nickel alloys are also important for the jewelry industry. You will certainly know white gold, for example. It is an alloy of gold, nickel, copper and zinc. However, the disadvantage of jewelry made from this alloy is the fact that many people suffer from an allergy to white gold. And that’s why they can’t wear such jewelry for a long time.

We should also mention that nickel can be toxic in excessive amounts. It can therefore cause an allergic reaction in contact with the skin. If inhaled or swallowed, it can damage the liver, lungs, or even the vascular or nervous system. It can also increase the risk of cancer. Therefore, its use in practice is now being restricted.   

Nickel production

Nickel is quite plentiful on Earth. And based on the fact that pure nickel is only found in iron meteorites that hit our planet, geologists think that most nickel is found in the Earth’s core. The largest reserves of this metal commodity can be found in three states. It has the most incomparably in Indonesia. It is followed by the Philippines, New Caledonia, Canada, Australia and Russia. Roughly 2.5 million crude nickels are mined annually globally.

The history of nickel

This metal has been known to people for more than 2 thousand years. At least to the people of China. Archaeologists have discovered objects made of nickel on Chinese territory. More precisely from its alloys. And they dated their age to 2 thousand years ago. Nickel as such was then officially discovered in 1751. German chemist Baron Axel Frederik Cronstedt discovered it.

At the time, he was examining nickeline ore and trying to isolate copper from the ore. It was he who named this ore nickeline. Of course, depending on the fact that it contains a newly discovered element. I mean nickel. It wasn’t until 15 years later that Torbern Bergman was able to obtain this metal in its pure form.

An interesting fact is that nickel, originally nickel, comes from a not-so-respectable word. Originally, it was a curse for miners. Those in medieval Germany mined the reddish ore. It was expected that they would be able to extract copper from it. But it didn’t quite work out. Therefore, this ore was derogatorily referred to by miners as kupfernickel. That is, copper with nothing.

How to trade nickel

We have already said enough about nickel as such. Well, now let’s dive straight into the whirlwind of deals and investments. Nickel is normally traded on the commodity exchange. This is where nickel supply and demand meet. Thus, nickel producers and those who want to physically have this metal participate in commodity exchanges. This mainly concerns those whose business is connected with its processing.

However, this is not the case for small traders. For those, on the contrary, it is usually not necessary for them to physically have the commodity they are trading with. Paradoxically, it may even be more advantageous for them if they do not have the given commodity physically. How is it possible? Because there is no need to pay for shipping and storage. Now let’s talk about how small traders trade now.

CFD trading

CFD trading is one of the most well-known ways of investing in the market today. These are contracts that have opened up the market to traders just like you. When you close a CFD nickel trade, you are not manipulating the metal as such at all. You are only speculating on the development of its price level. And nickel only functions as an underlying asset.

You can take, for example, a situation where you are examining the market situation. And you think big things could happen with the nickel price. That its value could increase significantly. And you will want to make money from it. Therefore, close the buy position. This will let the broker know that you are speculating on the growth of the price level of this metal commodity. If, on the other hand, you were speculating on a price drop, then you would instead enter a sell position. So, one of the advantages of trading with CFD assets is that you can also profit from a drop in the price level of the asset. And then you will just wait for the right moment to leave the store.

Your earnings will then depend on whether your speculation was correct. By closing a trade on a CFD asset, you and your broker are both committing to the fact that at the time you exit the trade, you will have to pay the other party the difference between the purchase and sale price of the asset. So if you guessed correctly, then the broker will pay you. And you will gain. But if your estimate turns out to be odd, you will pay. And that’s how you lose.

Nickel and stocks

Another way to close deals on nickel is to buy shares of companies whose activity is based on the production of nickel. Or for its further processing. As a shareholder, you will be entitled to vote at general meetings. And thereby participate in the further development of the given company. And you also get the right to receive a dividend. If, of course, you choose a company that pays a dividend.

Not all stock companies work this way. Some of them, on the contrary, invest their earnings back into their further development. However, this is not necessarily detrimental to shareholders. The company thereby increases its own value. And thus also the value of the shares you hold. In addition to classic stocks, you can also close trades on stock CFDs. In that case, however, you lose the opportunity to vote at general meetings.

Beware of risks

Trading nickel isn’t completely risk-free either. They mainly flow from the lever. Therefore, if you want to close CFD nickel trades, always check how high leverage you are closing the trade with. Keep in mind that the higher the leverage, the higher the risk of your trade. Financial leverage is a tool that multiplies your earnings and losses. It is thus possible that you will gain or, on the contrary, lose several times.

How to begin

Starting to close nickel stores is no science. The first step to success is finding a good broker. You can literally find online brokers on the web. But it doesn’t matter which one you choose. You could run into a scammer. So be careful when searching. And spend plenty of time reading reviews. It is important to give preference to a trusted broker that has acceptable fees and allows you to close trades on a nickel.

And the main thing is also studying. A good trader always knows exactly what is happening in the market. That’s why you should also keep the situation in check. And then sell or buy accordingly. It is a good idea to try your trading strategies on a practice demo account, which most online brokers now offer.

What affects the price of nickel

Now let’s take a look at what are the main factors that are important to look out for when trading nickel. So what can have a significant effect on the value of a nickel? Of course, the ratio between demand and supply of nickel is decisive. Therefore, the development of the industry, in which the properties of nickel are widely used, will certainly be decisive. As the industry grows, so does the demand for nickel. And with it, its value. Conversely, when the industry declines, the price of nickel falls.

And it will also depend on how much nickel is produced. And not only that. Because when one of the most important exporters reduces production or exports, a problem can arise. Nickel will be in short supply and its price will rise. The value of this metal can also be affected by the imposition of an embargo or customs duties. Therefore, it is important that you always have an overview of the economic and political situation.

Nickel – current online chart

How does the value of nickel evolve over time? Check out the current online chart.

Development of interest in the commodity

As already said, interest in a commodity rises when the industry grows. On the contrary, at the time of its decline, the demand for this metal decreases. Therefore, the demand for nickel will then be highest during the economic boom.

Nickel – Summary

So what now? All that remains is to find a good broker that you will like both with its conditions and platform, as well as with the offer of assets. And especially if you are a trader with no experience yet, you must not forget to try your speculations on the development of the price level first. Best through a demo account with your online broker. We wish you good luck!